Housing Market Slows as Builder Confidence Hits 7-Month Low

[Derek Brickley]

The spring housing market is sending mixed signals — and if you're buying, selling, or watching rates, here's what you need to know.

🏠 EXISTING HOME SALES SLIP IN MARCH

After a brief rebound in February, existing home sales fell 3.6% in March (NAR). The silver lining? Inventory climbed to 1.36 million homes — up 3% from February and 2.3% year-over-year. Still, supply remains historically tight, which continues to support home prices.

NAR Chief Economist Lawrence Yun highlighted that the typical homeowner has gained roughly $128,100 in housing wealth over the past six years. Even modest appreciation adds up fast — a $500,000 home gaining just 3% annually adds $15,000 in equity in a single year. Homeownership remains one of the most reliable wealth-building tools available.

🔨 BUILDER CONFIDENCE FALLS TO 7-MONTH LOW

Builder sentiment dropped 4 points to 34 in April — firmly in contraction territory. Rising mortgage rates, surging construction costs, and geopolitical uncertainty are squeezing builder margins and cooling momentum right as the spring buying season kicks off. Buyer traffic and forward-looking sales expectations both declined month over month.

The takeaway: fewer new homes are coming to market in the near term, which keeps pressure on an already tight supply picture.

📊 WHOLESALE INFLATION: COOLER THAN FEARED

March Producer Price Index (PPI) data came in better than expected. Headline PPI rose 0.5% monthly and 4.0% annually — both below forecasts. Core PPI (excluding food and energy) increased just 0.1% for the month and 3.8% year-over-year. Inflation remains elevated, but the trend is moving in the right direction.

On the jobs front, initial jobless claims fell 11,000 to 207,000 — a positive signal. However, continuing claims rose 31,000 to 1.82 million, suggesting workers are taking longer to find full-time employment.

📈 WHAT'S MOVING MORTGAGE RATES

Mortgage bonds closed the week higher after Iran announced the reopening of the Strait of Hormuz. The 10-year Treasury yield is trending toward a key technical support zone made up of its 50, 100, and 200-day moving averages. Continued progress on the U.S./Iran ceasefire talks could provide the rate relief the market has been waiting for.

🔭 WHAT TO WATCH THIS WEEK

• Tuesday: March Pending Home Sales + Retail Sales

• Thursday: Weekly Jobless Claims

• Ongoing: Oil price swings and geopolitical headlines

Bottom line: The market is navigating real headwinds — rates, costs, and uncertainty — but strong equity gains and improving inflation data offer reasons for cautious optimism.